Legislation in the U.S. Senate and House of Representatives, if passed into law, would offset the loss of a tax credit for New York’s craft breweries, Sen. Charles Schumer said.
The Brewer’s Employment and Excise Relief Act would cut the federal tax on small breweries in half, helping brewers reinvest in their businesses, hire new employees and keep the retail cost of New York-produced beer down, Schumer, D-N.Y., said Sunday.
“New York’s craft brew industry is not just about good spirits, it’s about good jobs,” Schumer said in a statement. “This legislation will go a long way toward covering the financial impacts of the repeal of this important state tax benefit and will allow small breweries to grow, expand and serve their brew at a price affordable to all New Yorkers.”
A state court ruled last month an exemption of 14 cents a gallon for the state’s small breweries is unconstitutional.
The state tax benefit applied to the first 200,000 barrels of beer. It also provided an exemption of 12 cents a gallon for beer sold in New York City.
New York brewers pay a $7 excise tax for their first 60,000 barrels each year. The BEER Act would cut the rate to $3.50 a barrel, and would cut the tax by another $2 on the next $1.94 million barrels produced, Schumer said.
State legislation is being introduced in Albany that would provide tax credits of 14 cents a gallon for the first 200,000 barrels of beer made by a licensed brewery in New York in a taxable year.
“State small brewers have spurred economic growth across the state,” said Assemblyman Joseph Lentol, D-Brooklyn, in a statement.
The industry has created a variety of jobs, including specialized beer production salesmen, distribution, transportation and retail, Lentol said.
“We must enact a beer production tax credit to offset the devastating court decision so that New York breweries can continue to grow,” he said.
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